Education Spending and State Economic Growth: Are All Dollars Created Equal?

Deskins, John; Hill, Brian; Ullrich, Laura Dawson

doi:10.1177/0891242409347370

Cited by 11 publications

(9 citation statements)

References 26 publications

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“…Equally, this result is corroborated by that of Bexheti and Mustafi (2015) in Macedonia and Trabelsi (2017). The study of Deskins et al (2019) in USA also revealed that public spending on higher education has negative effects on state employment and gross state national product while Maitra and Mukhopadhyay (2012) concluded on a negative effect Nepal. Churchill et al (2016) in their own study came to the conclusion that public educational spending has no effect on economic welfare in developing countries except in developed countries but Neil (2018) held that it has no effect on growth OECD countries but negative in developing countries.…”

Section: Negative and No Effects Of Public Educational Expenditure On Economic Welfarementioning

confidence: 99%

Educational Expenditure and Economic Welfare in Sub Saharan African Countries: Effects and transmission channels

Atabukum¹,

Akume²,

Jumbo³

2020

IJRP

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This study sets out to evaluate how public educational expenditure affects economic welfare. Specifically, we investigated the effects and the transmission channels of public educational expenditure on economic welfare in 15 Sub Saharan African (SSA) countries from 2000-2017. We sourced data from the World Development Indicators, World Governing Indicators, the Freedom House and Polity IV data bases. We used the Panel Corrected Standard Errors Estimator (PCSE) in a static model framework to evaluate the direct effects of educational expenditure on economic welfare and the causal mediation analysis to assess the channels through which public educational expenditures affect economic welfare. Our results from the PCSE estimator revealed that the square of public educational expenditure, democracy, access to education, quality governance, trade openness and financial development positively and significantly affect economic welfare in SSA countries while educational expenditure has negative and significant direct effects. However, based on the causal mediation analysis, we found out that trade openness, governance, democracy and educational access positively and significantly mediated the negative effects of public educational expenditure on economic welfare in SSA. On the basis, we strongly recommend that governments should increase the sizes of public spending on education, improve on governance, improve on access to education and liberalise their economies.

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Section: Negative and No Effects Of Public Educational Expenditure On Economic Welfarementioning

confidence: 99%

Educational Expenditure and Economic Welfare in Sub Saharan African Countries: Effects and transmission channels

Atabukum¹,

Akume²,

Jumbo³

2020

IJRP

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“…For instance, studies that focus on the locational model—that is, on government policies that can affect the location decisions of business and industry—investigate the effect of tax incentives and government expenditures on economic growth (e.g., Brulhart and Schmidheiny, 2015; Crain and Lee, 1999; Poulson and Kaplan, 2008; Prillaman and Meier, 2014). In contrast to this, some studies focus considerable attention on how human–capital development policies, such as education, job training, and health programs impact state economic growth (e.g., Deskins et al., 2010; Feiock, 1999; Murphy and Topel, 2016). Economic growth can also be explained within policy, management, and political boundaries.…”

Section: The Federal Government’s Functional Responsibility In Redistmentioning

confidence: 99%

Welfare, innovation capacity, and economic performance: Evidence from American federalism

Shin

2018

Public Policy and Administration

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Despite years of increased federal welfare spending, it is unclear how federal financial investments in welfare areas influence state economies. Based on the theory of functional federalism, this paper examines the impact of federal welfare spending on state economic performance. Employing error correction models, this research finds that state economic growth and volatility are directly observed by the long-term impact of welfare spending. The results also show that increased federal welfare spending boosts state economic performance indirectly, by motivating states to generate higher innovation capacity, especially, in knowledge-based economic development programs. This research extends our understanding of the determinants of state economic performance by addressing intergovernmental redistributive transfers, and state government's innovation capacity.

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“…Bensi, Black, and Dowd () are able to find a positive relationship, but only when they calculate growth and spending relative to the U.S. average. Deskins, Hill, and Ullrich () demonstrate that the problem may be due to aggregation; by separating K‐12 spending from that for higher education, they find that negative growth effects can be attributed to spending on higher education, whereas K‐12 spending exhibits no influence.…”

Section: Literaturementioning

confidence: 99%

Does Federal Aid to States Aid the States?

Horváth¹,

Moore²,

Rork³

2014

Growth and Change

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Using data from 1977 to 2009, we explore whether the agency issuing federal aid to states influences the rate of state economic growth. We find that agencies' housing poverty alleviation programs, such as the Department of Health and Human Services and the Department of Labor, have negative effects. The Department of Commerce and the Department of Interior have consistent positive effects, although this last effect is due to inordinately disproportionate spending in the state of Wyoming. Overall growth effects are relatively modest, suggesting that potential future cuts to federal discretionary spending may not be as damaging as feared.bs_bs_banner Growth and Change have negative or zero impacts, which we attribute to their role in poverty alleviation. So while more money is good for states, targeted money from specific agencies is better.Following a review of the state growth literature, we profile the way federal aid to the states has evolved over time. We then present our estimating equation and discuss econometric concerns that we face. After unveiling our results we conclude.

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Education Spending and State Economic Growth: Are All Dollars Created Equal?

Cited by 11 publications

References 26 publications

Educational Expenditure and Economic Welfare in Sub Saharan African Countries: Effects and transmission channels

Educational Expenditure and Economic Welfare in Sub Saharan African Countries: Effects and transmission channels

Welfare, innovation capacity, and economic performance: Evidence from American federalism

Does Federal Aid to States Aid the States?

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